Subscription finance platform made its debut in UK and Europe in November
Founder says Bridge in advanced discussions with 22 lenders on joining platform
Platform could expand into secondary, syndication market and areas like NAV loans
January 9, 2024 (Preqin News) - Bridge, a new marketplace for borrowers and lenders in the fund finance space, has launched in the US just three months after being unveiled in the UK and Europe.
The platform allows alternative investment funds and lenders to arrange capital call facilities, also known as subscription finance. Andrew Frazer Smith, a former director at NatWest Group and the founder of Bridge, said the real-time platform will generate significant time and cost savings, and allow existing lenders to grow while, encouraging new ones to enter the market.
Frazer Smith told Preqin News that Bridge was in advanced discussions with 22 lenders about signing up to the platform: ‘We’ve got a good mix of lenders at various stages of the sign-up process, ranging from the main UK and European pillar banks, to the more established alternative lenders, as well as other institutions who are interested in getting into the space.’
Frazer Smith said that GPs will benefit from access to a bigger pool of lenders, while lenders will have access to more GPs and the opportunity to sell ancillary services. Both sides should benefit from using the platform for their bid and arrangement process, a role that more firms seem to be considering outsourcing to debt advisors, and from improved data analytics, he added.
Bridge will initially focus on subscription finance, but Frazer Smith sees opportunities for expansion into the secondary, syndication market and related areas, such as NAV loans.
Law firm Cadwalader said that, while the $100bn global fund market faced many challenges in 2023, the number of new money sub-lines and renewals would likely be consistent with 2022’s figure.
On January 5, the firm’s Fund Finance Friday newsletter stated: ‘Our team was kept busy with NAV transactions as well as structures to facilitate capital-relief, off balance-sheet treatment and additional capacity across all fund finance products. Combining with that, we saw increased interest in GP liquidity lines and family office financings – all of which is symptomatic of wider market conditions.’
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